Egypt Citadel signs land deal for Sudan rice farm

Tue Apr 6, 2010 10:19am EDT

5:42am MST

CAIRO, April 6 (Reuters) - A unit of Egyptian private equity firm Citadel Capital (
CCAP.CA) signed a 30-year lease agreement for land south of Khartoum to build Sudan's first large-scale commercial rice farm, Citadel said in a statement on Tuesday.

Gulf and other Arab countries have been investing in a range of farming projects in Sudan, Africa's biggest country by area and long viewed as having huge agricultural potential.

The land leased by El-Nahda for Integrated Solutions, a portfolio company of Wafra, Citadel's platform company in the Sudanese agricultural industry, spans 60,000 feddans (25,210 hectares).

"The farm will produce rice primarily for domestic consumption in Sudan, a net importer of rice, allowing any excess to be exported to other nations in Africa and the Middle East," Citadel said in its statement.

Cairo-based Citadel, which controls $8.3 billion in investments spanning 14 countries, has made various ventures in the Sudanese market including buying a majority stake in a Sudanese biscuit and sweet maker last year. [nGEE5AO0GQ]

"As the third portfolio company under Wafra, El-Nahda builds on our experience at Sudanese Egyptian Agricultural Crops Company (SEAC) and Sabina," Citadel Managing Director Hisham El-Khazindar said in the statement.

"Sabina is on track to have 3,000 feddans under cultivation by next June, while SEAC will be ready to seed 20,000 feddans by the onset of the rainy season in mid-2011," he said.

The statement said the lease area is flooded for up to eight months a year by water held back by the Jebel Al-Awliaa Dam.

Sudan has a varied climate, with heavy rainfall in some areas and water from the Nile which means it can grow a range of crops from wheat and animal feed to citruses and oilseeds. (Writing by Shaimaa Fayed; editing by Simon Jessop)